Woodbois Ltd (AIM:WBI, OTC:WODBF) said it will be able to restart its operations in full as it has raised £6mln from new private investors and converted £1.75mln of its debt for equity.
By the end of this week the Africa-focused forestry and timber company expects to have cut its total debt to around US$5mln, from roughly US$15mln at the end of last year.
Directors believe the package provides sufficient working capital for at least the next 12 months.
It said the £6mln subscription, where 1,200,000,000 new shares are being issued, will satisfy the cash shortfall from when in April, the company received a termination notice over its banking facilities from Danish lender Sydbank group.
Woodbois said chief executive Paul Dolan will stand down once a suitable replacement has been found, with the intention that he becomes a non-executive director and takes responsibility for the initial phase of the afforestation project in Gabon.
The main investor in the subscription is Monaco businessman Hugh Wade-Jones, whose personal investment vehicle, CHCH Ventures, will own 21.7% of the voting shares once the shares are admitted.
He is the founder of debt-advisory business Enness Global and of Guernsey-based private debt specialist Tenn Capital, a joint venture with US hedge fund Elliott Management.
John Scott, founder of pallet maker Scott Group, also subscribed and will own a 10.85% stake.
Former Woodbois chairman Miles Pelham, a major shareholder through his Rhino Ventures vehicle, introduced Wade-Jones and Scott and will become a strategic adviser to the company for a six-month term.
The company said he will assist in undertaking a comprehensive review of all business lines intended to maximise shareholder value.
"We now stand refreshed and ready to deliver on our business objectives with a strong balance sheet in place, with the benefits of our recent capex to come, strong new partners and an enviable position in the buoyant carbon space," said Woodbois chair Graeme Thomson.